Deck 17: Industrialization, Entrepreneurship, and Urban Growth

Question 1

The assembly line and interchangeable parts were first used by Henry Ford.

Answer 1

False

Question 2

Tertiary employment tended to require generalized education and/or training and,therefore,it was found primarily in rural areas.

Answer 2

False

Question 3

One way to characterize technological change is "creative destruction," which basically means that today's innovation will productively destroy yesterday's capital investment.This destruction creates new job opportunities,boosts production and offers a greater variety or more goods and services than in the past.

Answer 3

True

Question 4

Industrialization and urbanization in the U.S.occurred simultaneously between 1860 and 1910.

Question 5

The growth and development of the U.S.economy during its period of rapid industrialization was largely influenced by centralized economic planning.

Question 6

By the end of the 19th century,bituminous coal still was the largest single source of mineral energy used in this country,despite the enormous increase in oil production and refining.

Question 7

Industrialization through heavy capital investments required savings by households,businesses and/or government bodies.

Question 8

Mass production was made possible by mass consumption,a national market and international trade.

Question 9

The percentage of people living in urban areas decreased surprisingly between 1860 and 1910.

Question 10

Open-hearth technology quickly replaced the Bessemer converter in the steel industry.This is an example of Schumpeter's creative destruction process.

Question 11

By 1913,the dominant method of making basic steel was the open-hearth furnace.

Question 12

Which of the following did NOT contribute to "internal economies" in the industrialization process?

A) Diminishing returns to scale
B) Central power sources
C) Managerial improvements
D) Transportation networks

Question 13

Schumpeter maintains that recessions provide businesspeople with incentives to advance technologically.

Question 14

By 1914 the American economy had transformed into an agricultural giant.

Question 15

Internal and external economies positively contributed to U.S.industrialization.

Question 16

The cost of output is income to the land,labor,capital and entrepreneurial talent used to produce it.

Question 17

Industrial entrepreneurs like J.P.Morgan,Henry Ford and Andrew Carnegie were driven by desires to earn profits.In the process of pursuing these profits,American consumers were made better off.

Question 18

Entrepreneurship results in an equal distribution of wealth and income.

Question 19

Output produced and sold always generates profits for businesses.

Question 20

The demand for goods and services decreases with a rise in employment and income.

Question 21

Which of the following is an example of external economies?

A) The cost of per unit produced in manufacturing goods falls as the industry size grows.
B) The cost of per unit produced falls as the firm size, not the industry size, grows.
C) The cost of per unit produced in manufacturing goods increases as the industry grows.
D) The cost of per unit produced falls as the size of the firm grows.

Question 22

According to Rosenberg (2004),the U.S.economy between the Civil War and World War II was relatively poor in which of its productive resources?

A) Land
B) Labor
C) Capital
D) Entrepreneurial talent

Question 23

During the industrialization of the U.S.,wealth was

A) unequally divided among the population but accumulating.
B) a product of a federal plan for economic development and growth.
C) the sum of all revenue earned by U.S. households and businesses.
D) none of the above.

Question 24

What do diseconomies of cities include?

A) Pollution
B) Crime
C) Congestion
D) All of the above

Question 25

Profit-maximizing industrialists are concerned with both revenues and costs.Transportation and production costs are an important part of total costs.Both are impacted by

A) location and power sources.
B) the cost of managing large quantities of productive resources found anywhere along the production chain.
C) the ability to concentrate or group resources in the same place.
D) all of the above.

Question 26

The exploitation of what resource supplied more than half of the increase in mechanical energy?in 1860-1910?

A) Petroleum
B) Water power
C) Anthracite coal
D) Bituminous coal

Question 27

Creative destruction includes all of the following except

A) The rise of the automobile industry at the expense of the carriage industry
B) The rise of the computer industry at the expense of the typewriter industry
C) The destruction of all capital during economic busts
D) There is no except; all of the above are examples of creative destruction

Question 28

Economies of scale result as a firm increases in size and expands its use of resources.Productivity increases and fixed production costs are spread over an increased number of goods and services.Which of the following are types of economies of scale?

A) Command economies
B) External economies
C) Open economies
D) Closed economies

Question 29

Between 1860 and 1910,the labor force in agriculture

A) dwindled to historic lows.
B) decreased at a slow steady pace.
C) increased but not at the same rate as the total labor force.
D) stayed the same.

Question 30

Between 1860 and 1914,the growth rate in industrial production

A) fell behind the growth in the overall U.S. population.
B) outpaced the growth rates in the labor force and population.
C) was less than the growth rate in agricultural production.
D) fell behind both the growth rate in agricultural production and that of the overall U.S. population.

Question 31

In the process described as Schumpeterian economic growth (involving Schumpeter's ideas?about growth),

A) recessions are the object of countercyclical policy designed to minimize the waste ?of unemployed labor and other resources.
B) expansions are considered wasteful because of the tendency for inflation to be ?generated near the cyclical peaks.
C) recessions are considered to be useful cleansing devices for abandoning inefficient ?uses of economic resources.
D) depressions are considered to be necessary to maintain greater equality of wealth ?and income over time.

Question 32

Internal economies in the U.S.during its period of industrialization involved the

A) production of goods in factories.
B) production in small, isolated towns spread throughout the U.S.
C) production of goods in factories grouped together in the same geographical region.
D) production of goods in isolated factories spread throughout the U.S.

Question 33

If the Habakkuk thesis had been correct-unamended by Rosenberg,David and others-a long-run decline in the supply of agricultural productivity west of the Appalachians would be matched by a proportional

A) decline in the productivity growth in eastern manufacturing.
B) increase in productivity in eastern manufacturing.
C) rise in American food imports.
D) rise in American exports of manufacturing.

Question 34

Schumpeter asserts all of the following except

A) A strong middle class fosters growth in society's entrepreneurial base.
B) Entrepreneurs are the leading force behind technological advancement.
C) Invention and innovation are unnecessary in a growing economy.
D) Secured property rights encourage risk-taking entrepreneurial behaviors.

Question 35

In the U.S.,the most recognized entrepreneurs during industrialization were

A) clearly monopolists.
B) robber barons, who solely realized the concentrated wealth accumulated nation-wide.
C) individuals whose market power clearly originated from within the government.
D) key individuals who were famous or wealthy.

Question 36

Throughout U.S.history labor and physical capital have been

A) input substitutes and complements.
B) output substitutes and complements.
C) product displacements.
D) mixed outputs.

Question 37

By 1910 the top ten industries included printing,malt liquors,tobacco cars and railroad cars.?The introduction of these new top ten industries indicated

A) a shift in consumer preferences toward luxury items.
B) an increase in real incomes in the U.S., permitting people to purchase luxury items.
C) a smaller percentage of total consumption expenditures on essential food, clothing and shelter.
D) all of the above.

Question 38

Mass production during U.S.industrialization involved using which of the following?

A) Interchangeable parts
B) Division of labor and specialization
C) The assembly line
D) All of the above

Question 39

Cities included all of the following economies of scale except

A) Transportation
B) Sanitation
C) Crime
D) Education

Question 40

By 1913,steel making by Bessemer converter had been completely surpassed by

A) continuous casting integrated mills.
B) the Basic Oxygen furnace.
C) electric furnaces.
D) open hearth furnaces.

Question 41

Using Schumpeter's theory on creative destruction,describe the role of the entrepreneur in?the growth and development of the U.S.economy.

Question 42

Identify the changes in the top ten industries during the late 19th century.Discuss the importance of these changes.

Question 43

Discuss how the availability of labor and exploitation of relatively inexpensive raw materials contributed to the increase in industrial output after the Civil War.

Question 44

Compare and contrast internal and external economies.Relate both to economies of scale with respect to U.S.industrialization.

Question 45

Throughout U.S.history,entrepreneurial activity would occur when

A) centralized economic planning was involved
B) distributed rights to profits were clear and protected
C) government intervention was pervasive
D) all of the above

Question 46

Which sector consists of services traded for food,shelter,housing or other services?

A) tertiary
B) secondary
C) primary
D) international

Question 47

Capital equipment can be labor-saving or labor-using.Use late-19th-century industrialization to illustrate the differences between the two types of capital and explain why and when industrialists switched between them.

Question 48

What are external economies? How did they contribute to U.S.industrialization,and how did ?U.S.industrialization produce external economies?

Question 49

In the 19th century,American capitalism appeared in its classic form: giant firms,industrial labor force,complete commercialization of agriculture and extractive industries,big banking and finance and giant transportation systems.The property laws handed down from colonial times were apparently the perfect vehicle for economic growth.Nevertheless,Hughes and Cain (2011)argue ?that there were several legal developments in the 19th century that further aided or facilitated entrepreneurial activity and the rise of industrial capitalism; in fact,these were essential to the rise?of industrial capitalism.Describe them.

Question 50

Discuss the "economics of urbanization" that gave urban areas economic advantages over rural areas and led to rapid urbanization and economic growth in the late 19th century.

Question 51

Describe the course of industrial development from the end of the Civil War to the beginning?of World War I.Use statistics on industrial production.

Question 52

Identify the importance of the steam engine in U.S.industrialization.

Question 53

How did mass production contribute to mass consumption? How did mass consumption fuel industrialization?

Question 54

Discuss the importance of standardization in those industries using interchangeable parts.

Question 55

As entrepreneurs find new market niches and help specific industries grow,other industries will

A) grow proportionately.
B) grow disproportionately.
C) fail.
D) grow disproportionately and fail.

Question 56

Discuss the factors that encouraged the use of mass-production techniques in the United States.